What is the practical difference between a government bailout vs. the FDIC being made to keep all depositors whole, even over the normal insured $250k limit?
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One bails out the bank, therefore keeping the bank “in business” and ensuring the customers have the money they’ve deposited. The other bails out the bank’s customers but leaves the bank, well, bankrupt. The last several times the government has bailed out the banks they immediately turned around and loaned more money out, using it as a way to make more money instead of propping up their assets. That has a lot to do with why there were any bailouts this time around.
One bails out the bank, therefore keeping the bank “in business” and ensuring the customers have the money they’ve deposited. The other bails out the bank’s customers but leaves the bank, well, bankrupt. The last several times the government has bailed out the banks they immediately turned around and loaned more money out, using it as a way to make more money instead of propping up their assets. That has a lot to do with why there were any bailouts this time around.
When the FDIC comes in, the bank depositers (who put their money in the bank in good faith) are saved. The bank owners (whose carelessness caused the problem) are left to die. In a bailout, the opposite can happen.
When the FDIC comes in, the bank depositers (who put their money in the bank in good faith) are saved. The bank owners (whose carelessness caused the problem) are left to die. In a bailout, the opposite can happen.
When the FDIC comes in, the bank depositers (who put their money in the bank in good faith) are saved. The bank owners (whose carelessness caused the problem) are left to die. In a bailout, the opposite can happen.
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